Quick follow up, this seems to be an issue in Windows version of Netbeans
only as far as I can see. I used the same setup in Fedora 17 and all works
well. Same version of Netbeans (7.2.1) and same version of plugins (selenim
module for php and selenium server).

I have used phpunit successfully on the command line in Windows so this
should not be the issue either. There seems to be an issue with setup or the
way it is called inside Netbeans but only in the Windows version.